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FCPA Blog Daily News

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Thursday
Dec112014

Dallas Airmotive pays $14 million criminal penalty for Latin America FCPA offenses

Dallas Airmotive Inc., an aircraft engine maintenance, repair, and overhaul firm based in Grapevine, Texas, admitted Wednesday that it bribed Latin American officials to win government contracts.

The company will pay a $14 million criminal penalty to resolve the FCPA offenses.

The DOJ charged Dallas Airmotive in a criminal information filed in federal court in the Northern District of Texas with one count of conspiring to violate the FCPA and one count of violating the FCPA’s anti-bribery provisions.

The DOJ and Dallas Airmotive entered into a deferred prosecution agreement.

Dallas Airmotive is owned by UK-based BBA Aviation plc, a public company listed on the London Stock Exchange. BBA wasn't named in Wednesday's enforcement action.

BBA Aviation has about 13,000 employees worldwide.

In January 2013, Dallas Airmotive named a new president and vice president for sales.

Between 2008 and 2012, Dallas Airmotive bribed officials of the Brazilian air force, the Peruvian air force, the office of the governor of the Brazilian state of Roraima, and the office of the governor of San Juan Province in Argentina, the DOJ said, citing a statement of facts Dallas Airmotive agreed to in the case.

The company "used various methods to convey the bribe payments, including by entering into agreements with front companies affiliated with foreign officials, making payments to third-party representatives with the understanding that funds would be directed to foreign officials, and directly providing things of value, such as paid vacations, to foreign officials," the DOJ said.

The DOJ said it had help in the case from its "law enforcement counterparts in Brazil."

A copy of the criminal information in U.S. v. Dallas Airmotive, Inc. filed on December 10, 2014 is here (pdf).

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In March 2012, another aircraft maintenance company, BizJet International Sales and Support Inc., paid a criminal fine of $11.8 million to resolve FCPA offenses in Mexico and Panama.

Bizjet is based in Tulsa, Oklahoma.

BizJet's owner, Lufthansa Technik AG of Germany, entered into a three-year deferred prosecution with the DOJ.

In July this year, the former CEO of BizJet, Bernd Kowalewski, pleaded guilty to conspiracy to bribe government officials in Mexico and Panama.

Kowalewski was arrested in Amsterdam and waived extradition to the United States.

In 2013, Peter DuBois, Bizjet's former vice president of sales and marketing, and Neal Uhl, a former vice president of finance, pleaded guilty to conspiracy to violate the FCPA. They were sentenced to probation and home detention.

Jald Jensen, a former sales manager at BizJet, was indicted for conspiracy as well as money laundering. He's at large and believed to be living abroad, the DOJ said.

The four defendants were indicted last year for bribes paid directly to foreign officials in Mexico, Panama, and Brazil.

In July 2012, aircraft maintenance company Nordam Group Inc. paid $2 million to resolve criminal FCPA violations.

The DOJ said the privately held Tulsa, Oklahoma company and affiliates bribed"'employees of airlines created, controlled, and exclusively owned by the People’s Republic of China in order to secure contracts" from those airlines.

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Richard L. Cassin is the publisher and editor of the FCPA Blog. He can be contacted here.